The United States believes that the digital service tax imposed by the Indian government on American technology companies is unreasonable and discriminatory, which constitutes a burden and restriction on U.S. trade. A few days ago, US Trade Representative Dai Qi announced that an additional 25% tariff will be imposed on seven categories of bedroom furniture and seats in India.

Since April last year, India has imposed a 2% tax on the income of foreign technology and e-commerce companies such as Amazon, Facebook and Google. Estimates indicate that the value of digital tariffs paid by American companies to India each year is at least about $55 million.

As a means of tariff retaliation, the United States has decided to impose equivalent taxes on Indian furniture and other products.

The Office of the United States Trade Representative stated that tariffs are expected to begin 180 days later, that is, on November 29. In order to have more time for multilateral or bilateral discussions to resolve issues. If the USTR determines that this period should be less than 180 days, it will issue another notice involving the collection of tariffs.

Regarding the US tariff threat, an Indian official said: “The Indian government will review the proposed actions with relevant stakeholders and take appropriate measures to safeguard the country’s trade and commercial interests, as well as the overall interests of the people.”